New F&A rates negotiated with federal government

"Research" and "Every addition to true knowledge is an addition to human power" and "A.J.J. Ayres" are carved in sand-colored stone above black double doors. A hand and chemistry equipment are also part of the carving.

Over the past year, the Controller’s Office at Miami University has been in negotiations with the federal government to determine the rate we must charge external agencies for Facilities and Administrative (F&A) costs (aka, “indirect costs”). Our on-campus F&A rate has been set at 42% since 2003.

During the course of the negotiations, it was determined that our actual F&A cost is approximately 56%. However, we proposed to keep the increase in F&A very modest. In addition, we were able to negotiate separate rates for Organized Research, Sponsored Instruction, and Other Sponsored Activities. The rates are applied to modified total direct costs (MTDC), which excludes capital equipment, participant support costs, tuition remission, rental cost of off-site facilities, scholarships and fellowships, and that portion of each subcontract in excess of $25,000.

In September, we received notice from the government that our new F&A rates are:

Rate (%) Location Category
44.5 On Campus Organized Research
44.0 On Campus Sponsored Instruction
39.0 On Campus Other Sponsored Activities
26.0 Off Campus All Programs

These rates are effective beginning September 1, 2014. Awards received beginning in September and all proposal submissions going forward will be required to use the new rates.

Please be assured that OARS is committed to making sure that this change will not affect the amount of direct costs budgeted in any grant that was submitted or awarded prior to this notice. We will notify and will work closely with all affected investigators and their funding agencies to handle this issue.


†Definitions of F&A Cost Rate Categories
  • On Campus: Sponsored activities conducted in whole or in part on one of Miami University’s campus locations. This includes field sites or stations administered by Miami University.
  • Off Campus: Sponsored activities conducted in whole, off site from any of Miami University’s campus locations. Any work (e.g., data analysis using university resources, library utilization, office work) conducted on any of Miami University’s locations as part of the sponsored activity is considered “On Campus”. Based on this definition, it is very uncommon to fall into the category of “Off Campus”.
  • Organized Research: Research or scholarly activities funded by grants and contracts from federal or non-federal sponsors, and must be separately budgeted and accounted for. This includes projects that are using instructional activities to address a research question. Most grants and contracts will fall into this category.
  • Sponsored Instruction: Teaching and training activities funded by grants and contracts from federal or non-federal sponsors. Sponsored Instruction includes agreements which support curriculum development as well as teaching/training activities (other than research training) whether offered for credit toward a degree or certificate, on a non-credit basis, or through regular academic departments or by separate divisions, summer school, or external division. Grants and contracts that support instructional activities to address a research question are not considered Sponsored Instruction.
  • Other Sponsored Activities: Projects funded by sponsors that involve the performance of work other than Organized Research or Sponsored Instruction, including support for travel grants, conferences or seminars, University public events, outreach and public service activities, library acquisitions, enhancing intuitional resources.


Written by Jim Oris, Associate Provost for Research & Scholarship, Miami University.

Image of inscription at National Hospital for Neurosurgery and Neurology, Queen’s Square, London by Paul Mison via Flickr. Used under Creative Commons license.

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